Four tips to effectively use influencer marketing

Ran Shaul, Co-founder of influencer marketing company Pursway gives four tips on how to use marketing to reach 'influencers' to convey a brand's message to others who will listen.

The fundamental marketing challenge today is more strategic than tactical. Numerous studies all draw the same conclusion – the majority of people buy based on the conversation and recommendations of trusted friends, family members, colleagues and, increasingly, online reviewers. Nielsen’s recent Global Online Consumer Survey found that ninety percent of consumers surveyed said they’d trust recommendations from people they know.

Who Are Your Influencers?

Marketers, understandably, put a lot of energy into identifying their most influential customers: the customers who are often the first to try new products, have large social networks, and are most vociferous in talking up (or down) their experiences online and offline. In fact, it is a different subset of customers that truly serves as the “everyday influencers,” with much greater impact on peer purchase behaviour [see box out B].

A Needle In A Haystack

Firstly, no one said it was going to be easy but even needles can be found if you use the right tool - rocket science is particularly useful!

Traditional CRM programs typically view each consumer in isolation, failing to capture the social sphere that affects their behaviour. A new approach, Influencer Marketing Management (IMM), is beginning to emerge :

Step One - Focus on the Influencer :

Accurately identifying purchase influencers in the first place is the foundation of the approach. Within your customer base is a group of some 7–15% that serve as opinion leaders for each product or service type who typically influence 3-10 followers.

Step Two - Focus on Transactions :

Focus on actual transaction data (and this is where the rocket science comes in...). Analysing millions of transactions to uncover patterns of influence is not easy, but it is possible with the right approach and the right algorithms. For example, two people shopping together in the same store could be coincidental, if the same couple also shop together in a different town, you start accumulating evidence for a social connection between them and eventually identify which is the influencer. Crunch enough data and you can determine influence patterns with extremely high conviction (>99.95%).

Step Three – Focus on the Story, not the payoff :

When marketing to the influencers, it’s important to remember that the more meaningful payoff is in their ability to cause others to follow, not the amount they shell out. Programs that create positive emotional experiences—such as ”be the first to know”, high touch personal contact, and early access to new products and services—are far more effective in turning influencers into advocates.

Step Four – Measure what counts :

Turning Influencer Marketing from a soft and fuzzy aspiration into a measurable marketing discipline requires a focus on the metrics that the CMO can take to the boardroom. Counting tweets and “followers” may be an interesting exercise, but what matters is whether targeting the influencers moves the needle.

When done right, IMM can leverage the viral power of opinion leaders creating marketing impact over their entire social sphere realising anything between 5x to 10x improvement in marketing ROI. By identifying, understanding, and cultivating the energy of its advocates, companies can harness the power of viral marketing, reach customers and prospects that might not otherwise be reached, and strengthen long-term customer loyalty. Out A :

“A single influential customer has the ability to reach almost as many impressions as traditional marketing outlets, but with greater trust and targeted relevancy. Marketers not tapping into this resource are missing a chance to add to their tool boxes, expand their reach, and improve relevance.” Source : Defining Influence as a Strategic Marketing Metric, Forrester Research, Inc., December 2009.

Box Out B : How Influence Networks Work

Jim is really annoyed with his car insurance company. They just messed up his bill for the third time in the last two years, and he’s thinking of switching. He could do some research on other providers, but he has little patience for the ins and outs of financial services. Instead, he looks to Julie, the office accountant, for advice. A quiet, unassuming type, Julie is an absolute wizard with numbers. Her suggestions on investment choices for the company’s retirement plan are gospel around the office. Why would Jim look anywhere else when it comes to insurance options?

Box Out C : IMM In Action

Crazy Line (a 70-store leading fashion retailer in Israel) has managed to outperform previous results of its CRM program as Ofra Lewin, its VP Marketing, affirms “We have been using extensive segmentation of our customer database for quite some time and have a very successful loyalty program that we have been cultivating for years. Working with Pursway, we have been able to target and engage our most influential customers above and beyond what we achieved prior to that, generating results that have contributed to a measurable increase in our bottom-line profit.”

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